Renewable Energy Is About To Boom In Africa: Here’s Why Businesses Should Care

Africa is a continent that has traditionally been left behind. But when it comes to renewable energy, the continent is shaping up to lead the charge. Right now, about a fifth of people living south of the Sahara are without electricity. This is for a number of reasons, including conflict and poverty. But perhaps the most important is that many people live in very remote locations. Getting electricity to these people has, so far, been too expensive for power companies. But that’s all set to change, thanks to renewables.

There is already significant momentum on the continent to support the renewable sector. There are booming renewable energy industries in countries like Kenya, South Africa, and Nigeria. And Africa looks set to lead the world in power generation at the beginning of this century. The organisers of Kenya’s Renewable Energy Conference expect Kenya to have 500 MW of solar by 2030.

So why should businesses care?

There’s Enormous Potential For Increased Output

Africa isn’t a continent known for its good fortune. But when it comes to renewable energy resources, the continent is in luck. If there’s one thing the continent isn’t short of, it’s sunshine. And that is what has led many leading analysts to predict the massive growth in the use of solar on the continent.

Right now, the International Renewable Energy Agency puts Africa’s use of renewables at 5 percent. That’s about the same as what we see in developed countries today, like the US. But over the next 15 years, that’s expected to grow more than fourfold. By 2030, 22 percent of energy in Africa is to come from renewable sources. And when you consider that the population is set to rise 30 percent in the same period, that’s quite impressive.

Investors Have Seen The Opportunity

It’s not just Greenpeace who are excited about the potential of solar in sub-Saharan Africa. It’s real investors with real cash too. Reports indicate that investors see opportunities all over the continent. The primary opportunity right now is in PV solar. But other types of solar, like concentrated solar, are also an option. So too are other renewables, like wind and biomass, although without such high returns.

The Economy Of Africa Could Be Transformed

For years Africa has been stuck in what economists call, the poverty trap. The continent has had decades of slow or no growth. And that has led it to be seen by many as a hopeless cause.

One thing that could shake it up is renewable energy. Renewable energy is cheap. And unlike the grid, it’s not susceptible to regular power outages. When power is available cheaply, all the time, people are more likely to take risks. They start investing in businesses and generating their own wealth. Before you know it, the continent is industrialising.

Then there’s the direct employment benefit of renewables. Experts predict that solar and wind generate about twice the number of jobs as coal or gas. Thus, renewables look set to provide Africa with both economic opportunities and social benefits. As people get wealthier, demand goes up, and businesses make more money.